inter action corporation · inter action corporation july 23, 2003 tse arrows results of operations...

1The World Leader in illuminator for CCD/C-MOS imager Solutions.

INTER ACTION Corporation

July 23, 2003TSE Arrows

Results of OperationsYear ended May 31, 2003


Corporate Profile

• Established: June 25, 1992

• Head office: 1-1 Fukuura, Kanazawa-ku, Yokohama, Kanagawa

• Capital: ¥548,853,950

• Shares issued: 29,934　


Corporate Motto

• “Client First”– Supply customized illuminators

• Device malfunctions– Solve the problem the same day – If a client in Taiwan has a problem in the morning,

leave for Taiwan on an afternoon flight from Japan


What are illuminators?

• In digital cameras and camera-equipped mobile phones CCD/C-MOS imagers function as a retina and a chemical cameras’ film .

• CCD and C-MOS imagers convert images “seen” through a camera lens into electrical signals.

• At semiconductor factories, illuminatorsgenerate light used to test CCD and C-MOS imagers.

Digital camera

CCDCCD


The Structure of a CCD/C-MOS Imager

The surface of a CCD/C-MOS imager is covered with a grid of tiny picture elements (pixels) that convert light into electrical signals. A three million pixel imager, for example, would have three million of these elements on its surface.


The Problem with CCD/C-MOS Imagers

Any imperfection in a CCD/C-MOS imager picture element (shown in white above) appears as a blank space in a picture.


Standard Semiconductor Testing

• Inspection of finished silicon wafers– Testers– Probers

• Pre-shipment inspections– Testers– Handlers

TesterHandler

Prober Tester


CCD/C-MOS Semiconductor Imager Testing

• Inspection of finished silicon wafers– Testers (with IP function)– Probers– Illuminators

• Pre-shipment inspections– Testers (with IP function)– Handlers– Illuminators

Prober TesterIlluminator

TesterHandlerIlluminator


Major Users

• Domestic semiconductor manufactures– Sony, Matsushita, Toshiba, Sharp, Sanyo,

Fuji Film, Canon, Fujitsu, Mitsubishi Electric, Seiko-Epson, Innotech, others

• Overseas semiconductor manufactures– Philips, Samsung, testing firms in Taiwan,

Atmel, Pictos, others


Main Competitor and Output Capacity

• Main competitor– NIKON CORPORATION– INTER ACTION’s global market share:

Over 60% (estimated)

• Output capacity– Production capacity: 35 units/month


Applications of CCD/C-MOS Semiconductor Imagers

PDA Notebook PCMobile phone

Automotive camera

Surveillance camera Facsimile scanner Copier

CCD/C-MOS camera modules

Digital camera

Digital video camera

Wristwatch camera

Fingerprint/iris ID

CCD/C-MOS image sensors


Digital Camera Shipments

Digital camera shipments

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

Jan.2000

May Sep Jan.2001

May Sep Jan.2002

May Sep Jan.2003

May

(Monthlyshipments)

Japan Europe

N. America Other exports

Source： Camera & Imaging Products Association

(Unit: thousand units)Jun. 01

- May 02Jun. 02

- May 03Growth

rateTotal shipments 17,058 31,007 1.82

(of which)Japan 5,278 7,563 1.43

Europe 4,189 9,587 2.29North America 6,050 9,762 1.61

Asia 1,541 4,094 2.66

Totalshipments

(of which)Japan

EuropeN.

America Asia

Jun. 01 - May 02

Jun. 02 - May 030

5,000

10,000

15,000

20,000

25,000

30,000

35,000


Global Demand Forecast of Digital Camera

Global Demand Forecast (Units: thousand units)1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Global demand 90 250 349 528 989 1,636 2,572 3,350 4,000 4,500YoY change (volume) - 278% 140% 151% 187% 165% 157% 130% 119% 113%YoY change (value) - 160 99 179 461 647 936 778 650 500Japan 40 100 139 158 249 483 655 800 900 1000U. S. 40 90 110 220 435 690 940 1150 1300 1450Europe 10 60 100 130 231 343 685 900 1100 1250Other regions 0 0 0 20 73 120 292 500 700 800

(Source: UFJ Tsubasa Securities Co., Ltd.)

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Other regionsEuropeU. S.Japan The global demand forecast does not include Digital still

camera (DSC) shipments in China, which are currently estimated at only 300,000 to 400,000 units per year but are expected to rise sharply to several million units in the near future. The above forecast will have to be revised upward, assuming that the projected growth in China materializes.

(Source: DSC Demand Outlook, UFJ Tsubasa Securities)


China’s Digital Camera Market

2002,Q1

2002,Q2

2002,Q3

2002,Q4

2003,Q1

2003,Q2

2003,Q3

2003,Q4

0

10

20

30

40

China's Digital Camera Market Forecast

(Unit: 10,000 units)

Actual/Forecast

Units sold Cumulative for thecalendar year

Growthrate

2002 Q1 Actual 9.2Q2 Actual 11.4Q3 Actual 20.1Q4 Actual 21.1 61.8

2003 Q1 Actual 22.3Q2 Forecast 25.0Q3 Forecast 28.5Q4 Forecast 30.5 106.3 172%

Source: Brain Child, Inc.

Period No. ManufacturerUnits shipped(10,000 units) Market share

1 Sony 3.55 15.92%2 Canon 3.29 14.75%3 OLYMPUS 3.08 13.81%4 Fuji Film 2.85 12.78%5 Kodak 1.34 6.01%6 Legend 1.23 5.52%7 Nikon 1.06 4.75%8 TSINGHUA 1.00 4.48%9 FOUNDER 0.91 4.08%10 Matsushita Electric 0.85 3.81%

Other 3.14 14.08%Total 22.30 100.00%

Market Shares (2003, First Quarter)

Source: Brain Child, Inc.

Sony

Canon

OLYMPUSFuji Film

Kodak

Legend

Nikon

TSINGHUA

FOUNDER

MatsushitaElectric Others


Mega-pixel Camera-equipped Mobile Phones

Mega-pixel camera-equipped phone Specifications(Major carriers: NTT DoCoMo, J-PHONE, au)

Carriers J-PHONE au

Model D505i SO505i SH505i F505i J-SH53 A5401CA

Camera resolution 0.63mega pixels

1.30mega pixels

1.00mega pixels

1.23mega pixels

1.00mega pixels

1.24mega pixels

(picture resolution) (1.23 mega pixels)

Imager (CCD or C-MOS) ＣＣＤＣＣＤＣＣＤＣＣＤＣＣＤＣＣＤ

Memory card Stick Duo Stick Duo mini SD mini SD SD Smart card

Other functionsFolds into a digital

camera whenrotated

8X zoom, 18 fastconsecutive shots

ID verification(fingerprint) Movie Sha-mail

Launch date May 23, 2003 June 4, 2003 June 20, 2003 July 11, 2003 May 22, 2003 May 30, 2003

NTT DoCoMo


Camera-equipped Mobile Phone Market Highlights

• Mobile Phone Shipment Forecast (2003)

• Camera-equipped Mobile Phone Market Forecast (Western Europe)– Camera-equipped mobile phone market forecast (Europe)– Western Europe to represent 66% of the global market

10,000 units Growth rate 10,000 units Marketshare

Growth rate 10,000 units Marketshare

Camera-equippedmodel share

2002 4,339 (4%) 2,535 58% - 0 - -

2003 4,441 2% 3,947 89% 56% 1,700 38% 43%Source: Yano Research Institute, Ltd.

Total mobile phoneshipments

Of whichcamera-equipped Mega-pixel camera-equipped mobile phones

Mobile Phones (domestic shipments)

2002 2003 2004 2005 2006

Share of the global market (Camera-equipped mobile phones)1.7% 9.0% 21.0% 45.0% 66.0%

Shipments of camera-equipped mobile phones (10,000 units)263 1,477 2,466 4,816 7,004

Source: GUARDNER Co., Ltd.


Blind corner monitors

Visibility from driver’s seat

Visibility with CCD camera

Rear-view monitorsVisibility with CCD camera

Driving support systems

CCD camera monitors lane indicators, sounds warning to alert driver as needed

Automotive Camera


Future Applications for Automotive Cameras

• As a replacement for mirrors　– Rear-view images can be

shown on a display.

• As an adjustment device for air bags– Adjusts strength of passenger seat air bag

according to size of occupant

• As a device to prevent drivers from falling asleep


New Applications

• Face authentication system (OMRON Corp.)– Condominium security system: Face ID control systems

for entry control

• Tourist spots popular with Americans– Tens of security cameras to installed in popular tourist spots

can be used to spot wanted criminals and missing children

– Identix Inc. (Minnesota) system

• Security camera’s help identify the criminal in a recent murder case in Nagasaki.


Imager Semiconductor Devices Market Forecast

Note: The above forecasts do not include the optical mouse since it is not directly related to the CCD/C-MOS illuminator market.

-

50,000

100,000

150,000

200,000

250,000

300,000

2000 2001 2002 2003 2004 2005 2006

C-MOS Imager Market Forecast Other applications

Security cameras

Disigital still cameras

Notebook PCs

Desktop PCs

Small hand-held devices

Mobile phones

-20,00040,00060,00080,000

100,000120,000140,000160,000180,000200,000

2000 2001 2002 2003 2004 2005 2006

CCD Market ForecastSecurity camerasVideo camerasDegital still camerasNotebook PCsDesktop PCsSmall hand-held devicesMobile phones

Source: CLSA　CREDIT LYONNAIS SECURITIES (Japan); Senior analyst　Mr. Kun Soo Lee


Summary Income Statements

(yen in millions)

Year ended Year ended DifferenceMay 31, 2002 May 31, 2003 Amount/%

1,4686

849-

857-

480-

(253)Ordinary income

Net income

604

(151) 329

Sales 242 1,710

Operating income (239) 610


Summary Income Statements

(yen in millions)

Amount %Current assets 932 2,311 1,379 248%Fixed assets 284 330 46 116%Total assets 1,216 2,641 1,425 217%

Current liabilities 358 928 570 259%Long-term liabilities 462 407 (55) 88%Total liabilities 820 1,335 515 163%

Shareholders' equity 396 1,306 910 330%

DifferenceAs of May 31,2002

As of May 31,2003


Sales

ShareSalesShareSalesTotal

ExportsDomestic

1,71014.3%24585.7%1,465Total

78320.6%16179.4%622Fourth quarter

3429.1%3190.9%311Third quarter

38010.8%4189.2%339Second quarter

2055.9%1294.1%193First quarter

(Yen in millions)

1,71014881101,481127Total

100%

783

342

380

205

TotalSalesUnitsSalesUnits

OtherIP modulesIlluminators

8.7%4.7%86.6%Share

4350669058Fourth quarter

2531428625Third quarter

660031427Second quarter

140019117First quarter

(Yen in millions, units)


Comparison of Sales by Customer

Toshiba 44 Sony 709Sony 38 Matsushita Electric 203Slicon Vision 23 Fuji Film 148Toyo Electronics 19 King Yuang (Taiwan) 130Dong Yang 19 Sharp 108Japan Samsung 15 Samsung (Korea) 71Canon 14 Toshiba 67ETRI 14 Sanyo Electric 62Matsushita Electric 10 Toyo Electronics 38Seiko Epson 10 Genesis Technology 37Fujitsu 7 IMS (France) 22Others 29 Hansung (Korea) 20

Arusu Electronics 17Yokogawa Electric 11Fujitsu 9Others 58

Total 242 Total 1,710

Year ended May 31, 2002 Year ended May 31, 2003(yen in millions）


Orders Received

(yen in millions)

First quarterended

Second quarterended

Third quarterended

Fourth quarterended

Aug. 31, 2002 Nov. 30, 2002 Feb. 28, 2003 May 31, 2003

Order received 218 430 635 822

Deliveries 204 380 343 783

Order backlog 506 556 848 887


Five-Year Summary

(yen in millions)

Year endedMay 31, 1999





Sales 218 503 805 242 1,710

Ordinary income 6 83 120 (253) 604

Net income 8 38 64 (151) 329

1999 2000 2001 2002 2003Net income

Ordinary incomeSales

(400)(200)

0200400600800

1,0001,2001,4001,6001,800


Alliance with Agilent Technologies

• In 1999, Hewlett-Packard established Agilent Technologies, Inc. by spinning off its Precision Equipment Division.

• A world recognized name in semiconductor testing systems.

• With a global installed base of more than 550 units, Agilent’s 93000SOC tester is the best selling tester in the world.


The testing System

• A four-site parallel inspection line is used to test semiconductors

- Tester (93000SOC) (Agilent model, no IP function)- IP model (Inter Action machine)- Illuminator (Inter Action machine)- Prober (or handler)

Agilent “93000SOC”Prober TesterIlluminator IP module


Advantages of the 93000 C-MOS Imager Testing System

• Accommodates four semiconductor devices at once– Eight semiconductor devices can be simultaneously illuminated

with an optional attachment.

• High-speed testing– Several times faster than other types of mixed testers

• Lower cost of test (COT)– Concurrent multi-device testing lowers the cost of test per device.


Joint Press Conference at SEMICON West ’03

• Inter Action and Agilent hold a joint press conference on July 16 at the SEMICON West ’03

– Agilent Technologies, Inc., Vice President Thomas N. Newsom

– INTERACTION Corp. , Managing Director, Kazuhiro Watanabe


Press Conference


SEMICON Show


Forecasts for the Fiscal Year Ending May 31, 2004

(yen in millions)

Sales 1,200 (of which) 1,200 (of which) 2,400 (of which)

Illuminators 1,100 900 2,000IP modules 50 250 300Other 50 50 100

(Profit margin) (Profit margin) (Profit margin)

Operating income 401 33% 403 34% 804 34%

Ordinary income 393 33% 396 33% 789 33%

Net income 228 19% 230 19% 458 19%

Jun. 1, 2003 - May 31, 2004Full fiscal year

Jun. 1, 2003 - Nov. 30, 2003First half Second half

Dec. 1, 2003 - May 31, 2004


Five-Year Summary and Forecasts for May 2004 Fiscal Year

1999 2000 2001 2002 2003 2004Net income

Ordinary incomeSales(500)

0

500

1,000

1,500

2,000

2,500






Year endingMay 31, 2004

(Actual) (Actual) (Actual) (Actual) (Actual) (Forecast)

Sales 218 503 805 242 1,710 2,400

Ordinary income 6 83 120 (253) 604 789

Net income 8 38 64 (151) 329 458

inter action corporation · inter action corporation july 23, 2003 tse arrows results of operations...

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