company presentation half-yearresults2010
TRANSCRIPT
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Schweiter TechnologiesSchweiter TechnologiesSchweiter TechnologiesSchweiter Technologies
Company Presentation
Half-Year Results 2010
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
ContentContentContentContent
� 1. Welcome and Introduction
2. Results Half-Year 2010
3. Division Information
4. Outlook
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Highlights First Half 2010 Highlights First Half 2010 Highlights First Half 2010 Highlights First Half 2010
� (1) Full consolidation of Composites business for 6 months - good results despite increase in raw material prices and currency fluctuations
� (2) Composites: Wind segment strong - mainly China -compensating weaker markets in US/EU
� (3) Composites: Good recovery in Display - mainly re-stocking, Architecture slightly below
� Significant market recovery in TEX and SEM driven by Asian countries, mainly China. Good volume and strong bottom line results also due to tight cost management
� Strong Group EBITDA with CHF 48.5 Mio. and Net Income of CHF 23.6 Mio
� Very solid balance sheet and still approx. CHF 300 Mio. funds available for future investments
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Revenues: 100 MCHF Employees: 200
One Group One Group One Group One Group ---- ThreeThreeThreeThree Leading Leading Leading Leading DivisionsDivisionsDivisionsDivisions
IsmecaSemiconductor
3A Composites
SSM Textile Machinery
Revenues: 100 MCHFEmployees: 300
Revenues: 700-800 MCHFEmployees: 2'900 (of which
1'300 in Ecuador)
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
ContentContentContentContent
1. Welcome and Introduction
� 2. Results Half-Year 2010
3. Division Information
4. Outlook
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
SSM Textile SSM Textile SSM Textile SSM Textile MachineryMachineryMachineryMachinery
in CHF Mio.
H 1
2010
H 1
2009
Total
2009 %
Orders received 47.2 13.5 47.9 250%
Revenues 43.8 13.4 38.6 227%
EBITDA 7.4 -5.5 -6.9 -
%-Revenues 16.9% - -
Employees (end of period) 210 195 192 8%
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
SSM Textile SSM Textile SSM Textile SSM Textile MachineryMachineryMachineryMachinery
� 227% increase in sales, however from low base
� Significant market recovery - mostly driven by China
� Increased Gross Margin
� Good EBITDA with CHF 7.4 Mio. Low fix cost structure
� New innovations presented at ITMA Asia well received
� Further asianizing of assembly capacities resulting in optimization of cost structure
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
IsmecaIsmecaIsmecaIsmeca SemiconductorSemiconductorSemiconductorSemiconductor
in CHF Mio.
H 1
2010
H 1
2009
Total
2009 %
Orders received 73.1 19.9 54.2 267%
Revenues 50.2 16.5 45.9 204%
EBITDA 6.5 -6.5 -7.2 -
%-Revenues 12.9% - -
Employees (end of period) 349 290 310 20%
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
IsmecaIsmecaIsmecaIsmeca SemiconductorSemiconductorSemiconductorSemiconductor
� Sharp increase (from low base) in sales by 204% reflecting upturn in semiconductor industry
� Further improved gross margin despite competitive market environment
� Good EBITDA with CHF 6.5 Mio. Continued tight fixed cost management
� Continued focus on innovation and relation-ships with key accounts
� New products for semiconductor/LED packages well accepted by the market
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
3A 3A 3A 3A CompositesCompositesCompositesComposites
in CHF Mio.
H 1
2010
H 1
2009
Total
2009
Orders received 416.3 - -
Revenues 387.3 - -
EBITDA 35.9 - -
%-Revenues 9.3%
Employees (end of period) 3'301 - -
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
3A 3A 3A 3A CompositesCompositesCompositesComposites
� Solid volume development in first half of 2010
� Strong core material business especially in China, EU and US rather depressed
� Strong recovery in Display due to re-stocking activities
� Architecture overall slightly down with strong sales in India and Middle East
� Gross margin affected by higher raw material cost not yet fully absorbed
� Stand-alone/separation cost in the amount of CHF 3.0 Mio. expensed, however below budget
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Group Group Group Group
in CHF Mio.
H 1
2010
H 1
2009
Total
2009 %
Orders received 536.6 33.4 175.2 1507%
Revenues 481.5 30.1 132.6 1500%
EBITDA 48.5 -13.0 -16.2 473%
%-Revenues 10.1%
EBIT 33.7 -13.7 -20.4 346%
Net Income/loss 23.6 -10.5 -20.4 325%
Employees (end of period) 3'863 488 3'045 692%
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
186186186186 171171171171
66666666
391391391391 41841841841878787878 134134134134
596596596596
302302302302 262262262262
5555
5555
5555
1717171716161616
33333333
28282828
10101010
113113113113115115115115
2006200620062006 2007200720072007 2008200820082008 2009200920092009 2010201020102010
644644644644 623623623623653653653653
240240240240203203203203
14141414
10101010
158158158158 182182182182
23.423.423.423.4
84848484
89898989
189.49.49.49.4 0.10.10.10.1
2010201020102010 2009200920092009 2008200820082008 2007200720072007 2006200620062006
Net Net Net Net assetsassetsassetsassets
CashCashCashCash
OtherOtherOtherOther
GoodwillGoodwillGoodwillGoodwill
OtherOtherOtherOther
LoansLoansLoansLoans
EquityEquityEquityEquity
StrongStrongStrongStrong Balance Balance Balance Balance SheetSheetSheetSheet
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Balance Balance Balance Balance SheetSheetSheetSheet Highlights Highlights Highlights Highlights
� Cash position CHF 260 Mio.
� Treasury shares 5.4% of share capital (market price: > CHF 45 Mio.)
� Very low short/long term bank liabilities
� Goodwill CHF 16 Mio.
� Shareholders‘ Equity CHF 644 Mio. = CHF 445 per share
� Equity ratio 72%
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
ContentContentContentContent
1. Welcome and Introduction
2. Half-Year Results 2010
� 3. Division Information
4. Outlook
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
SSM SSM SSM SSM TextileTextileTextileTextile MachineryMachineryMachineryMachinery
DP5
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
SSM SSM SSM SSM –––– ExcellenceExcellenceExcellenceExcellence in in in in YarnYarnYarnYarn ProcessingProcessingProcessingProcessing and and and and WindingWindingWindingWinding
Perfection in package quality for best process performance in
yarn treatment and finishing (dyeing/weaving/knitting)
� Precision winding for perfect and even yarn coloring (300 km per package)
� Uniform yarn tension during winding process (up to 2’500 m/min.) resulting in lower process cost (higher speed, less tension peaks)
� Quality and reliability of equipment e.g. rotating parts with up to 30’000 RPM in dusty industrial areas
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
StrongStrongStrongStrong NicheNicheNicheNiche PositionsPositionsPositionsPositions in in in in thethethethe ProductionProductionProductionProduction ChainChainChainChain
dye package winding
dyeing
staple yarnsstaple yarnsstaple yarnsstaple yarns filament yarnsfilament yarnsfilament yarnsfilament yarns
knitting / warp knitting:apparel, sport and leisure wear, socks, hosiery, automotive, etc.
weaving:apparel, shirts and blouses, linen, curtains, automotive,
etc.
yarn production
twisting
yarn finishing
fabric production(end-uses)
assembly winding
extrusion
spinningfalse twist texturing
air jet textu-ring
drawing
twisting
conventional covering
air covering
mercerising(singeing)
re-winding
All blue marked areas are supported by SSM equipment
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
10 Local service stationsand over 80 agencies worldwide
HorgenHorgenHorgenHorgen BejingBejingBejingBejing
HongHongHongHong KongKongKongKong
SpartanburgSpartanburgSpartanburgSpartanburg
Fort LauderdaleFort LauderdaleFort LauderdaleFort Lauderdale
ZhongshanZhongshanZhongshanZhongshan
StrongStrongStrongStrong Global Global Global Global PresencePresencePresencePresence
Sales & Service
Sales, Manufacturing, Service
IstanbulIstanbulIstanbulIstanbul
CoimbatoreCoimbatoreCoimbatoreCoimbatore
Sao Paulo
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
IsmecaIsmecaIsmecaIsmeca SemiconductorSemiconductorSemiconductorSemiconductor Equipment Equipment Equipment Equipment coverscoverscoverscovers thethethetheFinishingFinishingFinishingFinishing ProcessProcessProcessProcess of a Wide of a Wide of a Wide of a Wide PackagePackagePackagePackage VarietyVarietyVarietyVariety
DiscretesDiscretesDiscretesDiscretesPower Power Power Power discretesdiscretesdiscretesdiscretes
Small Small Small Small outletoutletoutletoutletICsICsICsICs ICsICsICsICs DiesDiesDiesDies LEDLEDLEDLED
ElectricalElectricalElectricalElectrical TestTestTestTest
component contacting and (testing)
Direct docking
MarkingMarkingMarkingMarking
Laser marking/ inspection
LeadLeadLeadLead/surface /surface /surface /surface inspectioninspectioninspectioninspection
2D, 3D, 5S co-planarity, surface
Full 3D component inspection
TapingTapingTapingTaping
Tape, Tube, Tray
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
IsmecaIsmecaIsmecaIsmeca Malaysia Malaysia Malaysia Malaysia –––– TrulyTrulyTrulyTruly AsianAsianAsianAsian
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
IsmecaIsmecaIsmecaIsmeca Malaysia Malaysia Malaysia Malaysia ---- ProductsProductsProductsProducts
NX16 and NX32NX16 and NX32NX16 and NX32NX16 and NX32
For standard processes and components
Modules, Kits, and Modules, Kits, and Modules, Kits, and Modules, Kits, and SpareSpareSpareSpare PartsPartsPartsParts
Modules for production enhancements, retrofit and upgrade kits, as well as spareparts
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Global Global Global Global PresencePresencePresencePresence in All Key in All Key in All Key in All Key SemiconductorSemiconductorSemiconductorSemiconductor Markets Markets Markets Markets
CarlsbadCarlsbadCarlsbadCarlsbad
La La La La ChauxChauxChauxChaux----dededede----FondsFondsFondsFonds
MelakaMelakaMelakaMelaka
SuzhouSuzhouSuzhouSuzhou
Sales & Service
Manufacturing
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
CompositesCompositesCompositesCompositesA Division of Schweiter Technologies
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Rationale for Schweiter to invest in Composites Rationale for Schweiter to invest in Composites Rationale for Schweiter to invest in Composites Rationale for Schweiter to invest in Composites
PerspectivePerspectivePerspectivePerspective of Schweiter Portfolioof Schweiter Portfolioof Schweiter Portfolioof Schweiter Portfolio::::
"Composites" fulfills criteria of
1. World market leadership/growth potential (organic/acquisitions)
2. Autonomy (full set of management skills in company)
3. Ability to stabilize machinery business portfolio of Schweiter
4. Proven history of strong free cash flow generation
5. Purchase price that leaves sufficient cash for
- further acquisitions in Composites
- complementary acquisitions in Textile Machinery and
Ismeca Semiconductor and/or
- substantial acquisition of fourth division
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
An Intelligent and Efficient Material ApproachAn Intelligent and Efficient Material ApproachAn Intelligent and Efficient Material ApproachAn Intelligent and Efficient Material Approach
Solid MaterialSolid MaterialSolid MaterialSolid Material
> Uniform mechanical properties
AdvantagesAdvantagesAdvantagesAdvantages
> Low weight - high stiffness
> Excellent surface quality and thermal insulation
> Efficient use of raw materials
> Enables modular design concepts
AdvantagesAdvantagesAdvantagesAdvantages
> Low weight - high stiffness
> Excellent surface quality and thermal insulation
> Efficient use of raw materials
> Enables modular design concepts
Composites MaterialComposites MaterialComposites MaterialComposites Material
> Thin, high performance skin material
> Low weight core material
> Adhesion between layers of highest importance
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Select attractive market segmentswith unmet or latent need for raw material efficient, low weight, high performance multi-material solutions
Identify and evaluateopportunities for
segment specific sandwich offering
Identify and evaluateopportunities for
segment specific sandwich offering
Designthe most effective sandwich configuration
Designthe most effective sandwich configuration
Specifythe most cost efficient raw materials
Specifythe most cost efficient raw materials
Source commodity raw materials
Own efficientand reliablemanufacturing technologies
Offer broad range of segment specific specialities
The Business IdeaThe Business IdeaThe Business IdeaThe Business Idea
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Products
Brands
Applications
Core Materials
Structural Core Materials
Engineering Foams and Balsa
Display
Sandwich Panels
Metal, paper and plastic skins and foamed core materials
Architecture
Sandwich Panels
Aluminum skins and various core materials
Broad Product Range and MarketBroad Product Range and MarketBroad Product Range and MarketBroad Product Range and Market----leading Brandsleading Brandsleading Brandsleading Brands
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
America
26%
RoW
24%
Europe
50%
Display
33%
Architecture
26%
Core
Materials
28%
Transport &
Industry
7%
Other
6%
by Market Segmentby Market Segmentby Market Segmentby Market Segmentby Geographyby Geographyby Geographyby Geography
Revenue Breakdown 2009 Revenue Breakdown 2009 Revenue Breakdown 2009 Revenue Breakdown 2009 ---- 3A Composites 3A Composites 3A Composites 3A Composites
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Market environment Business strategy
Wind growth
61 63
25
12
2431
Germany China US
Insta
lled w
ind c
apacity (
GW
)
2008 2012
Source: GWEC 2009, BTM Consult 2009, EER 2009
• Driven by increasing demand for renewable energy
• Wind energy takes a large share within the segment of renewable energy
• Originated in Europe; both China and the US have also made significant commitments
• Offering a full range of universal and specialty core materials to serve wind energy OEMs
• Composites responsible for 70% of world balsa production
• Focusing on sandwich design being the most economical solution
• Follow leading global customers and manage capacity increases are key success factors going forward
6-7% 38-50% 25-26%
Snapshot Wind Market Dynamics and StrategySnapshot Wind Market Dynamics and StrategySnapshot Wind Market Dynamics and StrategySnapshot Wind Market Dynamics and Strategy
CAGR
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BestBestBestBest----inininin----class Development and Innovation Capabilitiesclass Development and Innovation Capabilitiesclass Development and Innovation Capabilitiesclass Development and Innovation Capabilities
• Composites focuses on product and process development
• The key elements are:
– Innovation Management at Composites im@c
– Central R&D in Neuhausen
– Local R&D in key European and US sites
• R&D spend in 2008: US$12m (1.5% of net sales)
New product launches
4
8
6
3
16
2005 2006 2007 2008 2009
Core Materials Display Architecture
•Innovation emphasis:
– market, customer and technology scouting
– strategic product development roadmaps
– competencies identification and development
Innovation Field 'Media Facades'
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Global Footprint Global Footprint Global Footprint Global Footprint ---- Bridgeheads in HighBridgeheads in HighBridgeheads in HighBridgeheads in High----growth Economiesgrowth Economiesgrowth Economiesgrowth Economies
Germany
Switzerland
Assets
• Headquarters in Sins and Singen
• 5 Sites
• 790 Employees (26% of Total)
Osnabrück
AltenrheinSingenSins
Neuhausen
USA
Northvale, NJ
Benton, KY Glasgow, KY
Statesville, NCMooresville, NC
Assets
• PMU DAA Headquarters in Mooresville
• 4 sites
• 490 Employees (16% of Total)
Ecuador
Brazil
Manta
Guayaquil
Quevedo
Sao Paulo Assets
• 3 sites
• Sales office
• 8'500 ha plantations in Ecuador
• 1'330 Employees (44% of Total)
China
India
Changzhou
ShanghaiMumbai
Khopoli
Singapore
Assets
• 5 Sites
• Headquarters in Singapore
• 320 Employees (10% of Total)
Xiamen
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Investment HighlightsInvestment HighlightsInvestment HighlightsInvestment Highlights
• Business idea applicable to attractive markets
• Strong customer focus and deep understanding of end markets
• Leading position and winning brands in all current strategic
segments
• Access to leading distributors and OEMs
• Synergistic assets and technologies
• Proven history of strong free cash flow generation
• Market-leading innovation management
• Set-up to capture further growth
• Effective management and business model to serve multiple
markets and geographies
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
ContentContentContentContent
1. Welcome and Introduction
2. Half-Year Results 2010
3. Division Information
� 4. Outlook
36
HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
0
100
200
300
400
500
600
2005200520052005 2006200620062006 2007200720072007 2008200820082008 2009200920092009
-20
-10
0
10
20
30
40
50
60
2005200520052005 2006200620062006 2007200720072007 2008200820082008 2009200920092009
RevenuesRevenuesRevenuesRevenues OperatingOperatingOperatingOperating EarningsEarningsEarningsEarnings
in Mio. CHF in Mio. CHF
Group Performance Group Performance Group Performance Group Performance
0
100
200
300
400
500
600
700
2005200520052005 2006200620062006 2007200720072007 2008200820082008 2009200920092009
Net CashNet CashNet CashNet Cash
in Mio. CHF
*
* excl. PPA adj. of CHF 5.5 Mio.pro forma Composites für 12 Monate kons.
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Group Portfolio Strategy (1) Group Portfolio Strategy (1) Group Portfolio Strategy (1) Group Portfolio Strategy (1)
� The individual business units (divisions) are global market leaders in their segments - or at least have the potential to become global market leaders. Each is autonomous - including financially.
� The core of each strategy consists of innovation (starting pointfor all success to date), proximity to customers via an in-house sales and service system and concentration on critical value creation. Structures are lean and communication direct.
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Group Portfolio Strategy (2)Group Portfolio Strategy (2)Group Portfolio Strategy (2)Group Portfolio Strategy (2)
� The same care is applied to management development as to business development. A management culture is promoted which goes beyond product or even company cycles. In this way, limits are determined not by market segments, technologies or locations, but by these very management assets.
� The holding company is not interested in buying and selling businesses, but aims to develop them beyond the timespan of those currently in executive spots. Acquisitions are primarily intended to strengthen current positions; divestments only take place if there are better owners than Schweiter, or if there is no prospect of market leadership.
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
SSM Textile MachinerySSM Textile MachinerySSM Textile MachinerySSM Textile Machinery
� Expansion project Asia
� Strengthening supply chain
� Complementary acquisition - if possible
IsmecaIsmecaIsmecaIsmeca SemiconductorSemiconductorSemiconductorSemiconductor
� Execution of LED strategy
� Market introduction of new products
� Cost reductions on new module
3A Composites3A Composites3A Composites3A Composites
� Focus on customers and business opportunities
� Project stand alone
� Strategy assessment 2010-
Key Priorities H2/2010Key Priorities H2/2010Key Priorities H2/2010Key Priorities H2/2010
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
Outlook H2/2010Outlook H2/2010Outlook H2/2010Outlook H2/2010
SSM Textile MachinerySSM Textile MachinerySSM Textile MachinerySSM Textile Machinery
� Solid order intake expected to be continued in 2nd sem
� Volume orders are back - China remains strong, India picking up
� Local assembly (CN) with positive impact on results
IsmecaIsmecaIsmecaIsmeca SemiconductorSemiconductorSemiconductorSemiconductor
� Strong order intake to be continued in 2nd sem
� High sales expected in 2nd sem. Ramp-up as a challenge
� New products with positive effect on results
3A Composites3A Composites3A Composites3A Composites
� Solid course of business to be continued, wind energy (China) remains strong
� Focus on customers and business opportunities with positive impact on results
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HalfHalfHalfHalf----YearYearYearYear ResultsResultsResultsResults 2010201020102010
This document is for presentation purposes only and should not bThis document is for presentation purposes only and should not be construed as an offer, invitation or solicitatione construed as an offer, invitation or solicitation
to subscribe for purchase or sell any investment and neither it to subscribe for purchase or sell any investment and neither it nor anything it contains shall form the basis of anynor anything it contains shall form the basis of any
contact whatsoever.contact whatsoever.
Opinions expressed herein reflect the current judgment of the maOpinions expressed herein reflect the current judgment of the management of Schweiter Technologies. The nagement of Schweiter Technologies. The
presentation contains forwardpresentation contains forward--looking statements that involve risks and uncertainties. The actlooking statements that involve risks and uncertainties. The actual result ofual result of
Schweiter Technologies may differ materially from those anticipaSchweiter Technologies may differ materially from those anticipated in these forwardted in these forward--looking statements andlooking statements and
forecasts as a result of a number of factors.forecasts as a result of a number of factors.
The management of Schweiter Technologies does not accept any liaThe management of Schweiter Technologies does not accept any liability whatsoever with respect to the usebility whatsoever with respect to the use
of this presentation.of this presentation.
DisclaimerDisclaimerDisclaimerDisclaimer