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MarketScreener Homepage  >  Equities  >  Swiss Exchange  >  U-blox Holding AG    UBXN   CH0033361673

U-BLOX HOLDING AG

(UBXN)
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u blox : Capital Markets' Day Presentation 2020

11/25/2020 | 03:29am EST

Capital Markets' Day 2020

November 25, 2020

u-blox Holding AG

1

u-blox Holding AG - Analyst day 2020

Agenda

16:00-16:05

Welcome

Thomas Seiler

16:05-16:25

Why u-blox is core

Thomas Seiler

16:25-16:40

Business update

Thomas Seiler

16:40-16:45

ESG

Thomas Seiler

16:45-17:05

Financial update

Roland Jud

17:05-17:20

Break

17:20-17:30

R&D strategy

Andreas Thiel

17:30-18:10

Technology insights

Andreas Thiel

18:10-18:15

Round-up

Thomas Seiler

18:15-18:45

Q&A

2

u-blox Holding AG - Analyst day 2020

k

Disclaimer

This presentation contains certain forward-looking statements. Such forward-looking statements reflect the current views of management and are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results, performance, or achievements of the Group to differ materially from those expressed or implied herein.

Should such risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this presentation.

u-blox is providing the information in this presentation as of this date and does not undertake any obligation to update any forward-looking statements contained in it as a result of new information, future events, or otherwise.

3

u-blox Holding AG - Analyst day 2020

Why u-blox is core

4

u-blox Holding AG - Analyst day 2020

u-blox at a glance

A market leader in positioning and wireless communication technology

Our business

  • Global provider of leading positioning and wireless communication technologies
  • Number one GNSS module supplier worldwide, with in- house positioning chip
  • Enables OEMs to reliably locate and connect people and devices
  • A fabless company owning the full IP focusing on R&D and customer relationships
  • All manufacturing outsourced

Services

Connectivity, Location, Security

Positioning

Cellular connectivity

Short range

connectivity

To locate the source of

To connect over a wide

To connect

information

area

over short distances

Products comprised of chipsets, modules and data services

5

u-blox Holding AG - Analyst day 2020

u-blox at a glance in numbers

3

Core markets

Automotive Industrial Consumer

7600

Customers

served world-

wide

385m

1997

Revenue in 2019

Founded as a

zwuzu

spin-off from

in CHF

ETH Zurich

1/3

1000+

of revenue

Employees

AMER, EMEA,

68% in R&D

APAC

20.5 %

of revenue

invested into

R&D

2007

IPO and listed

SIX:UBXN

6

u-blox Holding AG - Analyst day 2020

u-blox today and tomorrow

Our value proposition endures

u-blox is in the right markets

IoT, autonomous driving and electric vehicles, Smart City and Industry 4.0 are megatrends shaping the world today.

u-blox will emerge even stronger after COVID-19

Solidly positioned to withstand the COVID-19 crisis and emerge even stronger.

u-blox's markets are growing and accelerating

In an increasingly connected world, the number of applications across our markets will only continue to grow.

7

u-blox Holding AG - Analyst day 2020

Why u-blox is core

Wireless connectivity is fundamental for IoT devices

Demand for wireless

Only wireless connectivity can deliver the capillarity for connecting billions of devices to the cloud

Technology develops rapidly

Wireless technology continues to become increasingly complex and most of our customers have little knowledge

Customers seek to minimize implementation risk

Wireless requires expertise for successful implementation, and outsourcing is the solution for an efficient go-to-market plan

u-blox delivers

Providing superior wireless connectivity solutions is our core function in the industry

8

u-blox Holding AG - Analyst day 2020

Wireless is the superior method of connectivity

Ideal across applications: automotive, industrial, and consumer

  • Only wireless can offer interconnectivity among devices
  • Wireless is more reliable than cables - it is self- healing and serviceable
  • Wireless is cost effective - only wireless technology makes cloud services feasible
  • Wireless continues to evolve - strong technology progress in radio signals, signal processing and encryption

9

u-blox Holding AG - Analyst day 2020

The importance of robust connectivity

Machine type communication requires powerful technology

Industrial use cases must be reflected in the basic solution concept

  • Requires a solid design to meet the end application

Extremely low risk tolerance for errors in industrial use cases

  • Typically used to manage important operational activity, such as fleet management

More complex operating schemes than with personal devices

  • Desired functionalities include low power schemes, battery issues, remote upgrades

Qualification and certification is essential for reliable operation

  • Standard to conduct thousands of individual tests for a new platform product to ensure robustness and high reliability

10

u-blox Holding AG - Analyst day 2020

We provide a comprehensive "one-stop-shop" solution

Positioning and wireless communication technology bring things to the cloud

From the customer's perspective:

  • A seamlessly integrated bundle of technologies leads to faster time to market
  • Execution risk greatly reduced when working closely with one competent supplier
  • Customer may be unable to create the desired solution on their own when dealing with several suppliers
  • u-bloxcan deliver the desired combination of hardware components and services, and ensure that it will cooperate seamlessly
  • No other provider has this capability

Services

Connectivity, Location, Security

Positioning

Cellular connectivity

Short range

connectivity

To locate the source of

To connect over a wide

To connect

information

area

over short distances

Products comprised of chipsets, modules and data services

11

u-blox Holding AG - Analyst day 2020

Technology leadership built over decades

Constant innovation and platform generation upgrades

Our innovation leadership

stems from a unique set of attributes that would be difficult to replicate

Deep IP pockets

Deep-rooted spirit

Culture that

Focus on the most

R&D teams with

from long

promising value

for stepping

appreciates

company history

proposals

outside the box

innovation

broad know-how

Supported and driven by more than 20 years of in-house experience

12

u-blox Holding AG - Analyst day 2020

Competitive environment

No other company offers the same solution space

Large semis

  • ST Microelectronics
  • NXP
  • Mediatek
  • Qualcomm
  • Broadcom

Small semis

  • Nordic
  • Silicon Labs
  • Sequans

Module makers

  • Sierra Wireless
  • Telit
  • Thales
  • Fibocom
  • Quectel
  • Focus on smart phones and other high-volume products
  • Very broad product portfolio - driven by consolidation
  • Only chip offering
  • Specialized in few technologies
  • Mostly chip offering
  • Produce modules based on reference designs provided by a semi supplier
  • No knowledge with respect to core IP and functionality
  • Only module capability

u-blox

  • Focus on industrial and automotive applications
  • Specialized in the IoT connectivity technology
  • Chip and module offering
  • Deep IP in wireless technologies

13

u-blox Holding AG - Analyst day 2020

Reference case Automotive

Broad expansion of electronics content

Driver

In-car

TCU (telematics

assistance

V2X

navigation and

connectivity

control unit)

entertainment

for car traffic

safety

In-car

connectivity

Semis revenue growth mainly driven by automated driving (CAGR = 20%)

14

u-blox Holding AG - Analyst day 2020

Reference case Industrial

Strong growth of connected devices

IoT connections growth rates

Trailer tracking

Satellite

2019-2025 (CAGR)

Rear view camera

communication

Wide area/Cellular

23%

Short Range

13%

Lock control

Remote controls

TCU (telematics

In-trailermonitoring control unit) and fleet management

Source: Ericsson Mobility Report, June 2020

15

u-blox Holding AG - Analyst day 2020

Reference case Consumer

A wealth of smart devices

Navigation and

tracking

Consumer IoT connections growth rates 2015-2026 (CAGR)

Home, wearables, sports 15%

Connectivity

16

u-blox Holding AG - Analyst day 2020

Business Update

17

© u-blox Holding AG - Analyst day 2020

Business update

Priorities continue to be driven by COVID-19 pandemic

Our Priorities

  • Protect the health and safety of our employees while ensuring business continuity and efficacy
  • Employees working remotely in most regions; in-person meetings possible again in certain APAC countries
  • Teamed with manufacturing partners to ensure no production interruptions or impact to available capacity
  • Initiated cost improvement measures totaling CHF 15 million in annualized savings
  • Continue to follow local government guidelines while ensuring we are ready for a market recovery

Business Impact

  • Little to no disruption to business operations worldwide
  • Successfully serving customers, manufacturing products and fully managing R&D programs
  • Customer relationships migrated to virtual meetings, engaging more often and with greater efficiency
  • Strong focus on creation of new business opportunities as COVID-19 has accelerated demand in certain end markets for connected devices
  • Adjusted production capacity to work through some inventory overswing through the remainder of 2020

18

u-blox Holding AG - Analyst day 2020

COVID-19: No paradigm shift

IoT, autonomous driving and electric vehicles, Smart City and Industry 4.0 are megatrends driving our business

  • Although business impacted in the near term, the megatrends driving growth and demand for our products will endure

Electric Vehicle expansion

    • Industrial customers continue to seek ways to drive efficiency and accuracy in their operations and businesses
    • Electronic content increase in automotive is driven by Electric Vehicle (EV) expansion and increasing environmental requirements (CO2 emissions)
  • COVID-19has, in fact, accelerated many of our markets
    • Industrial markets have an even greater desire to make products smart and connected
    • High touch consumer products such as fitness devices have experienced increased demand driven by the crisis

19

u-blox Holding AG - Analyst day 2020

And strong rebound expected

Expanding business pipeline

  • Optimistic for a rebound similar to the one following the financial crisis in 2010
  • First strong signs are in APAC: Record bookings in Japan and Korea, mainly thanks to Automotive
  • Solid project pipeline developing: Intensive customer engagements despite travel restrictions has accelerated the growth of new customer projects in our pipeline

Number of new customer projects, per month

*

*Through October 2020.

20

u-blox Holding AG - Analyst day 2020

Update: Automotive

Substantial impact from COVID-19 due to production shutdowns; revenues recovering led by APAC and recent uptick observed in EMEA and Americas

COVID-19 Impact

  • In H1 2020, revenue decreased to CHF 41.3m v. CHF 57.3m in H1 2019 (-28%)
  • Rebound since September has occurred mainly in APAC (record bookings in Japan and Korea)
  • Several ramp-ups help to counter-balance the decline

Expectations

  • Volumes (registrations) returning to 2019 levels in Europe
  • Autonomous driving remains in focus by OEMs
  • Electronics content increasing with more complex system architecture in cars, and EV expansion strongly supported, particularly in APAC

21

u-blox Holding AG - Analyst day 2020

Auto sales: Rebounding to historical norms

Volumes (registrations) recovering

Source: Bank Bär

22

u-blox Holding AG - Analyst day 2020

Update: Industrial

Stable in H1 2020 with most application sectors continuing to grow

COVID-19 impact

  • Revenue in H1 2020 was essentially flat at CHF 110.2m v. CHF 109.5m in H1 2019 (+1%)
  • Stable with most application sectors growing, except for telematics

UAV

✓ ✓

Infrastructure, surveillance, security

✓ ✓

Automation, monitoring, sensor

✓ ✓

Medical, healthcare

• Macro, small & femto cell

Metering

/ -

Tracking, telematics

- -

  • Trends driving growth in connected solutions continue, and in some cases, have accelerated due to COVID-19

23

u-blox Holding AG - Analyst day 2020

Update: Consumer

Downturn from COVID-19 due to restrictions impacting outdoor and communal activities

COVID-19 impact

  • H1 2020 revenue was CHF 12.8m v. CHF 14.6m (-13%)
  • Downturn in several applications (e.g. cameras, watches) but fitness was positive in H1 2020

Expectations

  • Recovery visible as lockdown restrictions have eased worldwide
  • Several new applications for COVID-19 tracking are driving some growth
  • Consumer applications represent relatively small part of our total revenue (7%)

24

u-blox Holding AG - Analyst day 2020

ESG

(Environmental, Social and Corporate Governance)

25

u-blox Holding AG - Analyst day 2020

How our products support sustainability

Connectivity and positioning are essential in achieving a greener infrastructure

Driving greener travel

Our JODY-W2Wi-Fi and Bluetooth products are being used in an inductive electric vehicle (EV) charging initiative which promises to simplify this key aspect of EV ownership, and thereby drive adoption of zero-emission vehicles.

Safer and energy efficient communities

Our UBX-M8 GNSS chipset and SARA-R4 series cellular modems are being used in smart street lighting. This enables real-time fault- detection that leads to faster repairs, keeping communities energy efficient.

Reducing greenhouse gas emissions from central heating

Heating large buildings is a significant contributor to global greenhouse gas emissions. The SARA-R4 cellular range is at the heart of a globally available system that cuts energy waste from buildings.

26

u-blox Holding AG - Analyst day 2020

ESG - why sustainability matters

Prioritizing sustainability results in value creation for all stakeholders in the long run

  • Since 2012, u-blox has been a member of the United Nations Global Compact, the largest corporate sustainability initiative in the world
  • The Internet of Things will make an exponential contribution to a more sustainable world and u-blox plays a key role in the innovation driving sustainability
  • Sustainability is about maximizing the positive effect that we as a business can have, including our responsibility to be a good corporate citizen to our employees, business partners, communities and the environment

27

u-blox Holding AG - Analyst day 2020

Our first sustainability report

In 2020, we published our first sustainability report detailing our commitment to these important initiatives

  • Identified and prioritized the topics most important to us and stakeholders, and aligned them with the 17 United Nations Global Compact Sustainable Development Goals (SDG)
  • The 5 u-blox sustainability pillars are:
    • Business Ethics, Privacy and Security
    • Employees
    • Environmental Responsibility
    • Supply Chain Responsibility
    • Communities

28

u-blox Holding AG - Analyst day 2020

Financial Update

29

u-blox Holding AG - Analyst day 2020

Half year 2020: Summary financial results

Results reflect the impact of COVID-19 across our business

  • Total revenues of CHF 174.0m, a decline of - 8.7% (-5.6% at constant exchange rates)
    • APAC revenues declined by -2% to CHF 70.1m
    • EMEA revenues declined by -16% to CHF 51.7m due to the automotive markets
    • AMEC revenues decreased by -14% to CHF 48.9m as consumer and fleet management applications softened
  • Despite decline in revenues, gross profit and EBITDA margins remain healthy
    • Gross profit margins increased slightly y-o-y driven by favorable product mix
  • Impairment charge of CHF 74.1m due to refocusing of R&D programs and market delays in automotive

H1 2020

H1 2019

Change

adjusted 1

2020 to

(CHF millions, except EPS and

IFRS

2019

reported

adjusted 1

margins)

Revenue

174.0m

174.0m

190.6m

-8.7%

(at constant exchange

(-5.6%)

rates)

Gross profit

79.0m

79.4m

86.1m

-7.8%

Gross margin (%)

45.4%

45.6%

45.2%

EBITDA

19.9m

24.1m

32.7m

-26.3%

EBITDA margin (%)

11.4%

13.9%

17.2%

  1. Excl. Share-based payments, impacts based on IAS-19, amortization of intangible assets acquired, impairments and non-recurring expenses

Revenue by region

Revenue by end market

(CHF

H1

H1

H1

H1

millions)

2020

2019

2020

2019

APAC

70.1m

71.5m

-2.0%

Automotiv

24%

30%

-27%

e

EMEA

51.7m

61.6m

-16.1%

Consumer

7%

8%

-13%

AMEC

48.9m

56.6m

-13.6%

Industrial

63%

58%

1%

Others

3.3m

0.9m

Others

6%

4%

13.%

Total

174.0m

190.6m

-8.7%

Total

174.0m

190.6m

-8.4%

30

u-blox Holding AG - Analyst day 2020

Big picture

Historical investment in R&D will enable us to move past current headwinds with competitive strength

To Date

  • Focused on expansion of chip development across technologies over past 5 years
  • Building services business to further support base of products
  • Navigated through strong macro head winds since 2018

Looking ahead

  • Three new platforms released in 2020
  • Recurring service business taking traction, acquired Thingstream in 2020
  • Robust customer project pipeline

31

u-blox Holding AG - Analyst day 2020

We create intellectual property

R&D priorities are balanced against positive free cash flow objectives

  • Free cash flow is our core KPI
  • R&D intensity managed to achieve positive free cash flow and balanced for continual building of innovative core Intellectual Property (IP)
  • Our balance sheet represents our core IP in the form of capitalized R&D and represents the intrinsic value of u-blox
  • Our IP is based on CHF 900m investment over the last 15 years

32

u-blox Holding AG - Analyst day 2020

Intellectual property is our core asset

Balance sheet represents our core IP in the form of capitalized R&D

  • Impairments of capitalized IP does not mean it has been completely written-off
    • Most of our IP continues to generate cash flow
  • Impairments are triggered by various reasons, including delays to market or an end-of-life product that is still being harvested
    • Mostly, these reasons indicate that the IP is still in use and generating cash flow
  • Capitalization and the rules for impairments are IFRS based accounting rules and do not necessarily reflect all realities

Input to modeling R&D cost:

  • 45% capitalization rate
  • Amortization lags capitalization by 2-3 years
  • 9 years harvesting time

33

u-blox Holding AG - Analyst day 2020

Revenue development

Recent revenue trends indicate COVID-19 low point may be in the past

  • After strong start to 2020, revenue began declining in April, reaching a low point in August
  • Since August, revenue has increased each sequential month through October
  • Bookings are increasing meaningfully, although remaining relatively short-term as customers are holding little inventory

Monthly booking trend

34

u-blox Holding AG - Analyst day 2020

Financial profile is solid

We are strongly positioned to withstand the impact of COVID-19

Resilient business model

  • Strong gross margin performance reflects specialty products, which tend to demonstrate more traction even during market downturns
  • Global business is diversified across geographic regions, products and end markets
  • CHF is a natural hedge against USD (100% for COGS; 60% for OPEX)
  • OPEX saving program in the amount of CHF 15m initiated with the aim to increase efficiency

Balance sheet strength

  • Ample cash and liquidity: CHF 100.6m cash at H1 2020
  • Bond refinancing to be determined in due time; net debt/EBITDA ratio is currently 0.3x
  • Strong IP portfolio - no further impairments expected

35

u-blox Holding AG - Analyst day 2020

Outlook

  • Due to UK Takeover Code rules and the recent announcement of a possible offer for Telit Communications plc we are currently unable to provide an update on our earnings for FY2020
  • We expect to be able to provide earnings guidance in the near future and will provide an update in due course

36

u-blox Holding AG - Analyst day 2020

Acquisition criteria

Our M&A strategy

  • M&A has always been a part of our long-term strategy; successfully closed 16 transactions to date
  • Target must complement product portfolio and add service component with a strong industrial logic
  • Purchase price to enable shareholder value creation based on conservative synergy calculation
  • Only willing to do acquisitions at reasonable valuation
  • Business model, management and culture an ideal fit for u-blox
  • Specific areas where we would find a complementary fit:
    • Technology acquisition
    • Gain economies of scale
    • Expanding customer footprint and cross selling
    • Recurring revenue models

We maintain a continual stream of

acquisition opportunities

37

u-blox Holding AG - Analyst day 2020

Break

38

u-blox Holding AG - Analyst day 2020

R&D Strategy

39

u-blox Holding AG - Analyst day 2020

u-blox proprietary wireless technology is unique

  • Long-termattitude: Wireless chips and modules in the industrial and automotive markets have a 5-10 year life-cycle
  • Core intellectual property (IP) re-used:Between generations of products and across the product portfolio. Low risk of obsolescence
  • Value-addedservices based on our core IP in the end device
  • Thorough verification and validation methods assure robust products
  • Advanced packaging and silicon technology create energy saving products in small form factors

40

u-blox Holding AG - Analyst day 2020

15

R&D centers worldwide

800+

engineers

CHF 100m+

annual investment (2019)

R&D strategy

Creating value bottom-up

  • Mixed signal competence: Analog radio and digital signal processing on one piece of silicon is our core technology and difficult to replicate
  • High software content: The specific software can only be developed by experts. It makes up 70% of our R&D cost and is key to differentiation

41

u-blox Holding AG - Analyst day 2020

Why do we do this?

Achieving sustainable competitive advantage and value creation

  • We derive a larger part of the value chain because we deliver more:
    • Enhanced functionality
    • Lower cost of ownership
    • Added services
  • We increase margins over the lifetime of the product
  • Independency from 3rd party chipset roadmaps: Better fit to customer demand
  • Customers take a long-termcommitment with u-blox because of our control of core intellectual property (IP)

Gross margin continually expanding since market launch

Platform results (Chip and module)

Note: Sample based case

  • Better customer support thanks to full insight and control

42

u-blox Holding AG - Analyst day 2020

Product launches 2020

Broad expansion of solution capabilities will drive business growth

Cellular communication

UBX-R5

UBX-R5LTE-M/NB-IoT chipset offers unprecedented wireless technology integration with built-inend-to-end security, making it ideal for mission-critical or long life- cycle IoT applications.

Short range radio communication

JODY-W3

Designed for the increasing number of wireless high speed connections that will be required in vehicles.

Positioning

M9

The ultra-robust M9 technology platform will serve demanding

automotive high-end telematics applications.

M10

Leading edge GNSS platform for wearables asset trackers, with size and very low consumption.

Services

Thingstream acquisition Enables u-bloxto expand ist services portfolio toward achieving unique silicon- to-clouddifferentiation.

43

u-blox Holding AG - Analyst day 2020

u-blox M10 just launched

All

44

u-blox Holding AG - Analyst day 2020

Big leap in Positioning

We are adding our 10th generation of GNSS receivers

Our brand new M10 GNSS platform

Services

Connectivity, Location, Security

Positioning

To locate the source of

information

M10 chip and module variants

45

u-blox Holding AG - Analyst day 2020

Cellular product center

46

u-blox Holding AG - Analyst day 2020

Market trends

IoT continues growth, COVID-related shift in applications

COVID is accelerating IoT growth in some areas:

• Touchless / contactless experiences, remote monitoring and

automation

impact

• This means more need for edge computing and AI, further

driving growth in sensor networks and connected devices

• IoT security becoming more critical to protect sensitive and

COVID

confidential data

• Efficiency gains will eventually drive business continuity in

post-COVID recovery

CAPEX-intensive investments may be postponed in the near term:

  • 5G deployments may be slower than expected in a number of regions

Micromobility

Shared and owned single user transport to avoid crowded public transportation.

Connected Health

Demand for remote monitoring, telehealth and connected clinical devices.

47

u-blox Holding AG - Analyst day 2020

Growth drivers

Ideally positioned across IoT applications and regions

  • Migration 4G and 5G: Broad 5G-ready IoT portfolio covering both LTE-M and NB-IoT
  • High integration: Introduction of combo modules with integrated GNSS support new compact applications
  • Secure data: Cloud devices with root of trust and support of IoT-Security-as-a-Service
  • Recurring revenue: Services that provide support over the lifetime of the product
  • New networks: First LTE-M module certified to FirstNet, US network for first responders and public safety applications

SARA-R5 series

  • LTE-M /NB-IoT
  • Secure Cloud
  • GNSS

SARA-R42 series

  • LTE-M /NB-IoT /
    EGPRS
  • Secure Cloud
  • GNSS

SARA-N3 series

  • NB-IoT

48

u-blox Holding AG - Analyst day 2020

R5 cellular chipset and module deployed to market

All major certifications achieved, for chip and module

49

u-blox Holding AG - Analyst day 2020

R5: Worldwide testing and certification

Covering leading base station makers and carriers

50

u-blox Holding AG - Analyst day 2020

Band means the frequency band prevailing in the respective area

Application 1: NetModule

  • NetModule is a leading manufacturer of communication products for M2M, Telematics and IoT
  • For their automotive gateway platform they chose u-blox's:
    • TOBY-L2cellular module,
    • NEO-M8LGNSS receiver with dead reckoning, and
    • JODY-W1Wi-Fi module (in some products)

The gateway platform enables e-mobility monitoring, fleet management, and remote vehicle diagnostics.

"The geographic proximity and the exceptional quality and reliability that one could expect from a Swiss enterprise certainly influenced us in selecting u-blox as our technology partner for this product platform." Jürgen Kern, CEO of NetModule

51

u-blox Holding AG - Analyst day 2020

Cellular priorities

• Expand leadership

• Transition of IoT

• Create more value

• Build next

in LTE-M with UBX-

applications to 5G

with combo

generation silicon

R5 chipset

solutions and

Services

53

u-blox Holding AG - Analyst day 2020

Positioning product center

54

u-blox Holding AG - Analyst day 2020

Market trends

Highly reliable and precise tracking and navigation

COVID impact

New solutions to limit

virus spread with

drone delivery

Continued trend for accurate and long battery life fitness tracking

Ramp up in e-bikes and

Growing interest for

e-scootersas healthy

stable network

commute to work

connections as more

alternative

people work from home

Growing interest in

Acceleration in IoT

reliable people tracking

increasing demands for

solutions for contact

more remote monitoring

tracing

and automation

55

u-blox Holding AG - Analyst day 2020

Growth Drivers

Positioning and timing key to reliable infrastructure

  • High precision for automated operations
    • Facilitating autonomous vehicles
    • Paving the path to a smart city
  • Highly precise timing for telecoms
    • Enables 5G infrastructures to meet future demands
    • Expansion to new network types
  • Super low power
    • Continued strong expansion of wearables
    • Very long operation time, also with small batteries

56

u-blox Holding AG - Analyst day 2020

Application 1: Robotics

Husqvarna - GNSS technology for autonomous robots

  • "Husqvarna is the undisputed global market leader in robotic lawn mowers"
  • Husqvarna robotic lawnmower with GNSS solution, and connectivity
  • Our broad GNSS portfolio offer great customer value
  • Our products enable a high precision satellite-based lawnmower with
  • higher productivity and
    lower installation costs

Robotic lawnmower

«u-bloxis recognized for their experience with the GNSS module and competence in that area.» Anders Johansson, CTO of Husqvarna

57

u-blox Holding AG - Analyst day 2020

Application 2: Autonomous cars

Functional safe technology at the core

  • Connectivity to the cloud combined with edge computing allows for solutions in autonomous control
  • High precision and functional safety are key to such solutions
  • u-bloxhas invested into this space for many years and will continue to expand its leadership

The new S-Class 2020

Source: www.carmagazine.co.uk, Sep 2020

Advanced Driver Assistance Systems (ADAS) assisted driving

58

u-blox Holding AG - Analyst day 2020

Positioning priorities

• Expand market

• Build up economies

• Strengthen

• Build up strong

share with new

of scale with new

leadership in high

position for ADAS

M10 for consumer

M10 platform

precision market

2+ solutions and

and tracking

ramp up ADAS 3+

applications

platform

59

u-blox Holding AG - Analyst day 2020

Short Range Radio product center

60

u-blox Holding AG - Analyst day 2020

Market trends

COVID impact

Higher volumes in

Acceleration in

New solutions to

Strong

fitness home

eHealth use

limit virus spread

2-wheelers

equipment

cases

(e.g. tracking)

market - from

shared to owned

Advancement in

Growing need for

Growing interests

Shift towards

introducing

EV charging

in indoor tracking

open OS software

Wi-Fi 6 and

infrastructure

and location

base

electrification

61

u-blox Holding AG - Analyst day 2020

Growth drivers

Delivering today and preparing tomorrow

  • Bluetooth as mass market technology: wide range of Bluetooth low energy modules and strong support for open OS ecosystem
  • Wi-Fifor today and tomorrow: successful launch of Wi-Fi 6 modules addressing both industrial and automotive
  • Market outreach: go-to-market partnership for untapped opportunities and stronger global distributors channels
  • Cloud connection: seamlessly through services
  • Indoor positioning: gained expertise and investment in technologies

62

u-blox Holding AG - Analyst day 2020

Application 1: Industry 4.0

Sulzer - From pumps to service revenues

  • Treon's sensors measure vibration on Sulzer's pumps and send this data to the cloud via Treon's gateway (incl. NINA-B1 and SARA-R4) for predictive maintenance.
  • Seeing strong investment into Industry 4.0, e.g. digital transformation:
    • Adding services to pure product sales
    • Shifting of business model to recurring revenues
  • Multiple successes with high profile companies in Europe

Monitoring vibration on pumps

63

u-blox Holding AG - Analyst day 2020

Application 2: e-bike

Modmo - When e-bikes replace cars

  • Featuring u-blox GPS technology with dedicated 4G data connection for location tracking and security:
    • Real-timelocation uploaded to a cloud server and retrieved from a mobile phone via cellular connectivity (LARA-R211)
    • Locking and unlocking e-bike with mobile phones via Bluetooth low energy (NINA- B111)
    • Connectivity handled in Thingstream platform

e-bike user management

"The reason we chose u-blox was because of its high quality, which raises the reliability of our product and adds value to the functionality of the smart bike,"

Jack O'Sullivan, Founder at Modmo.

64

u-blox Holding AG - Analyst day 2020

Short Range Radio priorities

Expand into the

Add on next releases

Gain strong traction

Expand services

high-performance

in SHO standards

with (indoor)

offering with secure

applications

positioning

connectivity

65

u-blox Holding AG - Analyst day 2020

Services product center

66

u-blox Holding AG - Analyst day 2020

Market Trends

Why services shape future business

IoT adoption is part of a broader cultural change to

optimize productivity and secure the business

and operating environment

impact

Reliable and robust connectivity is critical

• Services are in high business focus: They are

COVID

perishable products

• Businesses are increasingly converting to

service-based models

eMobility

Demand for electrical vehicles such as eBikes, eScooters and electric wheelchairs.

Connected eHealth

Demand for remote monitoring, telehealth and connected clinical devices.

67

u-blox Holding AG - Analyst day 2020

Growth drivers

Strong expansion of IoT requires more robust solutions

  • Service content increasing in most application segments - connectivity a generic pre-condition
  • Many new customers have little experience in cloud connectivity - need for out of the box connectivity
  • Edge computing - complementary features at the edge of the cloud
  • High expectations of availability and life-time maintenance
  • Data security consciousness - Security services is a recurring need

68

u-blox Holding AG - Analyst day 2020

Connectivity services - what is it about?

MQTT NOW is natively supported in u-blox modules

!

Host

MQTT

An alert activates in the product and sends a message to Thingstream system to notify the user for action.

E-Mail

!

Text message

69

u-blox Holding AG - Analyst day 2020

Application 1: Bridgit Home Support Hub

Upstream Health - E-health increasing wellbeing

  • Real-time medical and behavioral home monitor that measures more than 40 data points
  • Patients can live more safely and independently in their homes
  • With the MQTT Anywhere service, u-blox'sThingstream platform automatically connects to remotely and securely collect and transmit data

Medical and behavioral home monitor

70

u-blox Holding AG - Analyst day 2020

Application 2: Cooler system

Largest brewer AB InBev stay cool in South Africa

  • u-blox'sIoT connectivity solution supports AB InBev with a Fridgelogic Connected Cooler system
  • The solution enables AB InBev to track and monitor the temperature and location of its coolers and fridges

Ajay Lalu, Director, CIRT, said: "Thingstream provides us with the confidence that a cellular connection will always be maintained, without a guaranteed connection IoT, solutions just fail. Thingstream's connectivity platform is unique in its ability to not only ensure connectivity but also output IoT messages in a way that can be ingested for real-timeinterpretation."

The AB InBev refrigerator

Source: https://www.itweb.co.za/content/dgp45MaGNRbvX9l8, 2019

71

u-blox Holding AG - Analyst day 2020

Services priorities

• Timely expansion

• Roll-out new

• Increase

• Make solutions

of Thingstream

services

recurring revenue

unique and

services delivery

to double digit

differentiated

platform

percentage of

revenue

72

u-blox Holding AG - Analyst day 2020

Summary - round up

73

u-blox Holding AG - Analyst day 2020

Takeaway: Positioned to thrive

Our long-term strategy and focus remains unchanged

  • The secular trends propelling the growth of positioning and wireless technology in automotive and industrial applications will continue

Leader in positioning and wireless connectivity solutions

  • Offering a unique, comprehensive solution offering that no other company can provide
  • Our IP portfolio reflects our long history of R&D know-how built over decades of experience
  • New product platforms paving the way for expansion: three new Positioning platforms in market, strong traction R5 based LTE connectivity, building recurring revenue segment of the business

Well positioned to capitalize on a market recovery

74

u-blox Holding AG - Analyst day 2020

u-blox today and tomorrow

Our value proposition endures

u-blox is in the right markets

u-blox's markets are

growing and accelerating

u-blox will emerge even stronger after COVID-19

75

u-blox Holding AG - Analyst day 2020

Q&A

76

u-blox Holding AG - Analyst day 2020

Thank you

for your attention

77

u-blox Holding AG - Analyst day 2020

Disclaimer

u-blox Holding AG published this content on 25 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 November 2020 08:28:07 UTC


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Financials
Sales 2020 357 M 402 M 402 M
Net income 2020 -52,7 M -59,4 M -59,4 M
Net cash 2020 0,63 M 0,71 M 0,71 M
P/E ratio 2020 -9,89x
Yield 2020 0,22%
Capitalization 522 M 586 M 589 M
EV / Sales 2020 1,46x
EV / Sales 2021 1,28x
Nbr of Employees 1 080
Free-Float 91,8%
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Mean consensus HOLD
Number of Analysts 6
Average target price 67,00 CHF
Last Close Price 75,25 CHF
Spread / Highest target -1,66%
Spread / Average Target -11,0%
Spread / Lowest Target -26,9%
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Managers and Directors
NameTitle
Thomas William Seiler Chief Executive Officer & Director
André Müller Chairman
Roland Jud Chief Financial Officer
Jean-Pierre Wyss Director, Head-Production & Logistics
Gina Aline Domanig Vice Chairman-Board
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