u-blox investor presentation€¦ · source: (ericsson mobility report november 2016, abi wireless...

locate, communicate, accelerate

u-blox Investor Presentation

September 2017

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.

© u-blox Holding AGSlide 2

Company Overview

Our vision


To be the leading supplier of high-quality

communications and positioning components in

The Internet of Things that Really Matter


Source: Geeny.io

Drones ~5 Mio

Pets ~0.5 bn

Cars ~0.5 bn

Laptops ~900 Mio

Bicycles ~1.3 bn

Kids ~1.8 bn

Parking Spaces ~1.2 bn

Hospital Beds ~1 Mio

Power Tools ~1.3 bn

Street Lights~1 bn

The Internet of Things: Billions of devices waiting to be connected

u-blox: Enabling the Internet of Things (IoT)


• Founded in 1997

• Listed on the SIX Swiss Exchange since 2007 (SIX:UBXN)

• Global semiconductor player

• The only company focusing on wireless and positioning, with leading technology delivered as both integrated circuits and modules

• 2016 revenue CHF 360m, H1 2017:CHF 193m

• 2010-2016 compound annual growth 21%

• More than 900 employees worldwide (end of H1 2017)

• Strong innovation track record in wireless technology

A global business


Revenue by geography / EBITDA in m CHFu-blox revenue split per market

IndustrialConsumer

Automotive

270.0

338.3

360.2

161.9 179.7

193.9

58.6

78.7 81.8

36.5 39.1 40.3

0

50

100

150

200

250

300

350

400

2014 2015 2016 H1/15 H1/16 H1/17

Revenue EBITDA

(million CHF)(million CHF)

7.9%

Highly diversified global customer base

• Broad customer base with more than 5700 customers and significant market share

• Expanding customer base: customers in more than 66 countries worldwide

• Customer diversity: Top 65 customers in 24 countries

• No single customer responsible for more than 5.3% of total sales

• 15 sales offices; 14 R&D locations


5700CUSTOMERSWORLDWIDE

15SALES

OFFICES

66COUNTRIES

WORLDWIDE

Strong product line-up for IoT – unique market position


• u-blox technology is available in a unique combination of chips and modules

• This combination provides for a inimitable market positing and drives our profitability

PositioningCellular

CommunicationShort Range

Communication

Integrated Circuits

Modules

Services and Solutions

CellLocate®

AssistNowTM

Correction Data

FOTA (Firmware update over the air)

Security

Reference Designs

PositioningCellular

CommunicationShort Range

Communication

Integrated Circuits

Modules

Services and Solutions

CellLocate®

AssistNowTM

Correction Data

FOTA (Firmware update over the air)

Security

Reference Designs

Strong competitive advantage


• Important strategic benefits from the unique u-blox line-up

• Long-term sustained competitive position

Cro

ss funct

ional

valu

e

Serv

ices

on

top o

f H

W

Strong synergies between the technologies

High cross selling effect

Full

ow

nerof te

chnolo

gy

Maxim

um

com

pete

nce

Marg

in e

xpansi

on

u-blox leading connectivity technology for the

Internet of Things that Really Matter


• u-blox solves the What, Where and When of the IoT

• What – the data transmitted

• Where – the device located

• When – the time the data was captured

• u-blox unique technology

• Technology leader in GNSS based positioning and timing

• Complete intellectual property in GNSS, LTE, BT and Wi-Fi

• Driving connectivity technology for adoption to IoT

u-blox plays in the high growth connectivity markets


• The mobile phone market has plateaued

• The future growth lies in both, wide-area and short-range IoT applications

They are u-blox heartland for connectivity solutions

Source: Ericsson Mobility Report, November 2016

u-blox target

markets

Connected devices (billions)

Mobility and the Cloud economics drive our markets for IoT


0

50

100

150

200

250

2000 2005 2010 2015 2020 2025

Ever expanding Mobility index

Source: The Economics Of The Cloud, Microsoft

Strong scale economies in the Cloud

• The mobility of people continues to increase year on year

• Cost of data processing in the cloud decreases exponential with volume

These forces work hand in hand giving a multiplier effect for IoT

TC

O/S

erv

er

(at

avera

ge

uti

lizati

on

)

Source: Transport Outlook 2011, OECD

80% reduction of total cost of ownership

The Internet of Things that Really Matter – IoT connectivity

market will become large


• M2M deployments to grow strongly

• Price points to decline

• Strong integration into chipset

feasible for cellular M2M modems

This is the opportunity for u-blox in-house silicon

Source: ABI research 2016

Cellular M2M

0

100

200

300

400

500

600

700

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Cellular M2M

LTE Cat-1 LTE Cat-M NB-IoT


Internet Cloud

Sensors & Actuators Content

Mobility

Rover

Infrastructure

Mobility and the Cloud economics drive our markets for IoT (2)


Internet Cloud

Sensors & Actuators Content

Mobility

Rover

Infrastructure

Source: u-blox estimates

400m BLE (Bluetooth Low

Energy) beacons shipping in

2021

90m cars sold with USD300

electronic components

content by 2020

65m smart meters

installed by 2020

20b connected devices

by 2020

Mobility and the Cloud economics drive our markets for IoT (3)

Our Focus

Four IoT focus areas for u-blox


Connected vehicle Connected city Connected industry

Adaptive cruise control shipments to be 80 million by 2025

7.7 million truck platoon systems to ship by 2025

Over 246 million connected auto infotainment systems to ship between 2015-2020

(Source: ABI research, 2016)

600 million Smart home device shipments by 2021

Home care robotics to revenue to quadruple to $6 Billion by 2025

46 million Connected street lights by 2021

Smart meter connections to exceed 789 million by 2021


Goods tracking market to swell to $5.6 Billion in 2021

From 2014 to 2020, the number of connected industrial controllers will triple; growing at an average rate of 20%

Global wireless sensor network market expected to grow to $1 Billion by 2020

Source: (Technavio 2016)

Connected consumer

Massive use of smart phones: 3.9 Billions in 2016 will grow to 6.8 Billions in connected consumers in 2022 with many regions having more subscriptions than people

100 million BT connected sports and wellness devices and 250 million Wi-Fi connected flat screen TVs and set top boxes by 2020

Global wearable market expected to grow to $5.8 Billion by 2018

Source: (Ericsson Mobility Report November 2016, ABI Wireless IoT and Cellular 2016 & Statista 2016 )

The IoT focus areas offer vast potential


• Attractive value of connectivity and positioning in the four IoT segments

• Expected CAGR of 19.2% from 2015 to 2025

• Especially the potential of smart factories (Industry 4.0) is very large

• The size of the economical benefits will drive investments

Source: McKinsey The internet of things: Mapping the value beyond the hype. 2015

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

Vehicle City Industry Consumer

$ b

illio

ns

Connectivity value by 2025

Low estimate High estimate

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

Vehicle City Industry Consumer

$ b

illio

ns

Positioning value by 2025

Low estimate High estimate

Connected vehicle


Automated parking technology to

grow by 30% CAGR over next

decade

7.7 million truck platoon systems to

ship by 2025

Over 246 million connected auto

infotainment systems to ship

between 2015-2020


u-blox applications

• ADAS

• Car connectivity

• Driving recorder

• Emergency call

• In-car navigation

• Insurance box

• Mobile gaming

• Road pricing

• Stolen vehicle recovery

• Vehicle telematics

• Vehicle tracking

• Infotainment

• V2X

The future of the connected vehicle


2015 2020 2025 2030

Basic V2X Communication

• Roadwork warning

• Emergency Vehicle Warning

• Traffic-jam warning

• Post-crash warning

Fusion of V2X and

Sensor Data

• ACC-Adjustment

• Lane Change Warning

• Simple Merge-In warning

Fully Developed Situation

Analysis

• Advanced Merge-in assistance

• Hazardous Area Warning

• Platoon start at intersection

Active Coordination

• Highly Automated Driving

• Cooperative Merging

• Overtaking Assistance

V2X Basis Data Fusion Collective Perception Cooperative Agreements

Wireless connectivity and high precision positioning enable the autonomous car.

Connected city


600 million Smart home device shipments by 2021

Home care robotics to revenue to

quadruple to $6 billion by 2025

46 million connected street

lights by 2021

Smart meter connections to

exceed 789 million by 2021


u-blox applications

• Point of sales

• Home entertainment

• Metering

• Mobile hotspot & router

• Street light systems

• Traffic management system

• Waste & water management

The future of the connected city


2015 2020 2025 2030

Smart meters

• Power balancing

• Supply stability

• Network management

Smart infrastructure

• Adaptive capacity

• Preventive maintenance

2000W community

• Power and energy control

• Optimizing supply and demand

• Reduction of losses

Autonomous public

transport

• More granular transport capacity

• Adaptive capacity

• Reduction of foot print

Collective Perception System adoptions Deep change Optimization

Cellular and positioning technology are the route to connected infrastructure.

Connected industry


Goods tracking market to swell to $5.6 billion in 2021

From 2014 to 2020, the number of connected

industrial controllers will

triple; growing at an

average rate of 20%

Global wireless sensor network market expected to grow to $ 1 billion by 2020

Source: (Technavio 2016)

u-blox applications

• Asset tracking

• Aviation & UAV

• Healthcare

• Industrial terminal

• Machine control

• Monitoring & control

• Router and gateway

• Security

• Farming

• Fleet management systems

The future of the connected industry


2015 2020 2025 2030

Cloud and agility

• Smart service

• Customer feedback

• Self learning

Smart Engineering

• Digital collaboration

• Digital modeling

Smart Factory

(Industry 4.0)

• Integrated planning

• Proactive maintenance

• Process automation

• Product lifecycle

Digital Marketing

• CRM

• Omni channel presence

• Self service portals

• Dynamic pricing

Agility Fast loop Closed loop Cooperative loop

Wireless technology makes the things that matter connected.

Connected consumer


Massive use of smart phones:

3.9 billion in 2016 will grow to

6.8 billion in connected

consumers by 2022 with many

regions having more

subscriptions than people

100 million BT connected sports

and wellness devices by 2020

250 million Wi-Fi connected flat

screen TVs and set top boxes by

2020

Global wearable market

expected to grow to $5.8

billion by 2018

Source: (Ericsson Mobility Report November 2016, ABI Wireless IoT and Cellular 2016 & Statista2016 )

u-blox applications

• Child tracking

• Pet tracking

• Fitness

• Cameras

• Watches

• Toys

• Personal health

The future of the connected consumer


2015 2020 2025 2030

Social Media

• Media landscape reshuffled

• Immense information flow

• Internet giants dominate

Smart sensing

• Immense data gathering

• Extraction of features and patterns

• Fast feed-back

Augmented Reality

• Seamless merging of virtual and real world

• Broader access to relevant information on the spot

Artificial intelligence

• Delegating tasks to personal agents

• Agents learns and anticipates users needs

Sharing Intelligence gathered Deeper involved Enhanced capabilities

Wireless technology and position sensors make the consumer connected.

Leading u-blox IP for the IoT focus markets


Highly automated driving

calls forDead reckoning and high

integrity

Inspection drones

call forDecimeter accuracy

Cellular infrastructure

calls forPrecision timing

Personal tracking

call forUbiquitous positioning

In car infotainmentcalls for

High-bandwidth cellular

Water, waste, lighting, etccall for

Low whole-life cost: NB-IoT

Asset tracking, fleet mgtcall for

Global coverage

Consumer devicescall for

Low and high bandwith

connectivity

Highly automated drivingcalls for

Vehicle to Vehicle comms

Point of Sale, smart homecall for

Multi-standard solutions

Sensor networkscall for

Intelligent gateways

The quantified selfcall for

Low power connectivity

Positioning technology


• Standard precision products

• Meter level accuracy

• Suitable for most applications

• High tracking sensitivity

• Low power consumption

• High precision products

• Centimeter to decimeter level accuracy

• Suitable for a range of new applications

• Dead Reckoning products

• 100% positioning coverage incl. tunnels

and urban canyons

• For road-vehicle applications

• Timing & Frequency products

• For stationary and time, or frequency

synchronization

LEA

17 x 22.4 mm2

CAM

9.6 X 14 mm2

NEO

12.2 x 16 mm2

EVA

7 x 7 mm2

MAX

9.7 x 10.1 mm2

u-blox module form factors – de-facto industry standards

High precision for the mass market

Communication link

Base

NEO-M8P-2

Rover

NEO-M8P-0

Cellular


• Extensive range of cellular modules for

GSM, UMTS and CDMA

• Global coverage; competitive specification,

common physical footprint and software

APIs

• High performance multi-mode LTE modules

• Global certifications, Cat 4 & Cat 6

performance with higher categories to

follow, automotive specification options

• Low data-rate single-mode LTE, NB-IoT and

RPMA modules

• Leading edge products, first to market in

many territories

• Aimed at IoT applications

Short-Range technology

• Bluetooth Low Energy for low data rates

• BT 4.2

• Expansion; BT 5.0 and Mesh in 2017

• Wi-Fi for high data rates

• 802.11 a/b/g/n/ac

• Expansion; 2.4/5 GHz 802.11ax

• V2X modules for automotive applications

• Based on a variant of Wi-Fi (IEEE 802.11p)

• US legislation drives deployment for 2021 timeline


Developing profitable growth


0

2

4

6

8

10

12

14

16

18

20

22

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Millio

ns

per

year

Positioning Cellular Short Range

* acquisition of assets

modules shipped

Neon Seven

Geotate

Fastrax

Signav*

4M Wireless

Cognovo

lesswire*antcor

connectBlue

AirSemi*

Fusion Wireless

• On track to build a robust business

with three “legs”

• Positioning

• Cellular

• Short-Range

• Strong volume growth track

• Synergies between each area in the

key markets

• Combination of 3rd Party and u-blox silicon provides a broad product

range and scope for differentiation

Financial Outlook

Continuous growth and profitability (1)


0

50

100

150

200

250

300

350

400

2014 2015 2016 H1/15 H1/16 H1/17

APAC Americas EMEA

25%

48%

27%

178.4

25%

50%

25%29%

48%

23%

(million CHF)

7.9%

26%

46%

28%

25%

47%

29%

26%

21%

53%

Geographical revenue mix Application revenue mix

IndustrialConsumer

Automotive

Continuous growth and profitability (2)


Gross Profit trend EBITDA trend

122.7

155.0167.1

72.882.5 87.4

45.4% 45.8%46.4%

44.9%45.9% 45.1%

0%

10%

20%

30%

40%

50%

60%

0

20

40

60

80

100

120

140

160

180

2014 2015 2016 H1/15 H1/16 H1/17

Gross Profit % of revenue

5.9%

270.0

338.3

360.2

161.9 179.7

193.9

58.6

78.7 81.8

36.5 39.1 40.3

0

50

100

150

200

250

300

350

400

2014 2015 2016 H1/15 H1/16 H1/17

Revenue EBITDA

(million CHF)(million CHF)

7.9%

Outlook Goals


• Grow business with new products

Wireless

• Expansion of module product line

• High Cat modules

• Low Cat LPWA modules

• First u-blox chipset in modulefor Cat1

Positioning

• Business growth based on u-blox M8 and u-blox 8

• High precision solutions

Short Range

• Expansion of product offer for latest versions of standards

• BLE

• Wi-Fi

• Wi-Fi 11p*

• Continued focus on strategic development

• Strengthening of the global presence

• Operational excellence for higher efficiency

*) Forthcoming standard for V2V/V2X communication

Product launches highlights in H1.2017


TOBY-L4

The LTE module provides a secure solution for automotive OEMs enabling data, voice, positioning, eCall and advanced telematics.

SARA-S200

This ultra small module offers significant size and cost savings for secure and robust M2M and IoTwireless applications.

VERA-P1

The latest in a range of automotive-grade transceiver modules that enables the next generation of Advanced Driver Assistance Systems.

UBX-M8230-CT

Ground-breaking GNSS receiver chip for wearable applications offering a unique balance of performance and ultra-low power use.

NINA-W131 & NINA-W132

Secure ultra low power Wi-Fi modules that efficiently integrate Wi-Fi connectivity into IoTdevices.

ZOE-M8G

An ultra-compact GNSS receiver module which offers exceptionally high location accuracy especially designed for wearables, drones and asset trackers.

SARA-R410M

The world’s smallest quad-band LTE module, ideal for diverse IoT and M2M applications including smart cities, connected healthcare and more.

JODY-W1

The automotive Wi-Fi & Bluetooth module enables real simultaneous dual band operation for faster Wi-Fi connectivity and is ideal for infotainment and telematics applications.

Sapcorda (Safe And Precise CORrection DAta)

• Sapcorda Services GmbH is based in Berlin.

• Will distribute GNSS positioning services for high precision GNSS applications.

• Targeting mass market applications such as Automotive, Industrial & Consumer.

• Setup as a Joint Venture with u-blox, Bosch, Geo++, Mitsubishi Electric.

• Service to be sustained by the involved industry.

• No single partner has a majority share.

• Each partner has a strategic interest in Sapcorda’s services.

• Joint Venture announced on 8th August 2017.

• Closing expected for mid October 2017.


Sapcorda


• Sapcorda to distribute GNSS correction services to serve the mass market

• Global and continent wide coverage.

• One way communication (Broadcast) with satellite

& terrestrial internet communication channels.

• Open system: Available to all GNSS receiver

manufacturers.

• Targeted at OEMs and system integrators (B2B

business model).

• Affordable for mass markets (e.g. Cars,

Surveying, Agriculture & Machine Control).

CommunicationSatellite

GNSS receiver

Internet

SSR correction service

GNSS

Financial performance and guidance 2017


• Maintained guidance for 2017

• Continued business growth in 2017

• Impact by product mix on relative gross margin

• Natural hedging protects relative gross margin against foreign exchange variations

+10% of USD EUR GBP

Revenue + 8.6% + 1.3% 0%

EBIT + 21.1% + 1.0% - 2.0%

• Exchange rate assumptions for 2017:EUR/CHF: 1.07 USD/CHF: 1.02 GBP/CHF: 1.23

• FX-sensitivity against CHF on Guidance 2017

*) This guidance is based on the absence of unforeseen economic adversity and exchange rates assumed at budget level

Actual

FY 2015

Actual

FY 2016

Guidance 2017*)

Revenue 338.3m 360.2m 410m…425m

EBIT 51.3m 59.0m 60m… 65m

CHF CHF CHF

Key takeaways


u-blox positioned for profitable growth

Technology Leadership: investing to expand our technology roadmap and lead in GNSS and Wireless technology for IoT

Control of the core technology

Consistent Execution: First to market with new products targeted to our key applications

Focus and invest in potential growth sectors

Growing organization to meet market demands

Corporate Information

u-blox Holding AGThalwil, Switzerland

u-blox AG (Headquarter)

Thalwil, Switzerland

u-blox Singapore Pte. Ltd.

Singapore

u-blox Japan K.K.

Japan

u-blox Asia Pacific Ltd.

Hong Kong

100% 100% 100% 100%

u-blox Italia S.p.A.

Italy

100%

u-blox Espoo Oy

Finland

100%

u-blox America, Inc.

USA

u-blox AG Beijing representative office

Beijing

Representative office of u-blox Singapore Pte. Ltd.

Taipei

u-blox Singapore Pte. Ltd. (Branch office)

Seoul

Sales organization R&D entities

u-blox AG Shenzenrepresentative office

Shenzen


Bangalore


Sydney

u-blox AG Shanghai representative office

Shanghai

100% u-blox UK Ltd.

UK

u-blox San Diego Inc.

USA

100%

u-blox Luton Ltd.

UK

100%

u-blox Melbourn Ltd.

UK

100%

u-blox Lahore(Private) Pty.

Pakistan

100%

u-blox Melbourn Ltd.Leuven Branch

Belgium

100% u-blox Cork

Ireland

u-blox Malmö

Sweden

100% ConnectBlue Inc.

USA

u-blox Athens

Greece

100%

u-blox Berlin

Germany

100%


u-blox AG Chongqing representative office

Chongqing

100%

Sapcorda GmbH

DE

43%1

1) From end of October 2017

Legal structure u-blox group

Board of directors


Additional information – see Corporate Governance and Financial Report 2016 p. 8 - 13

Fritz FahrniChairman

Member NCC

André Müller

Member AC

Prof. Gerhard Tröster

Chairman NCC

Gina Domanig Dr. Paul van Iseghem

Chairman AC

Thomas Seiler

CEO

Jean-Pierre Wyss

COO

Executive Committee


Additional information – see Corporate Governance and Financial Report 2016 p. 14 - 16

Thomas Seiler

CEO

Head of Marketing and Sales

Jean-Pierre Wyss

Executive Vice President

Head of Production and Logistics

Co-founder u-blox AG

Daniel Ammann

Executive Vice PresidentPositioning Products


Andreas Thiel

Executive Vice PresidentWireless Products


Roland Jud

CFO

Shares (June 30, 2017)


Stock Exchange SIX Swiss Exchange

Swiss Security Number / ISIN 3336167 / CH0033361673

Ticker UBXN

Nominal value CHF 0.90

Shares issued 6‚930‚640 (June 30, 2017)

Market cap CHF 1’197 Mio (June 30, 2017)

High / Low (H1 2017) CHF 224.70/ CHF 164.60 (June 30, 2017)

Latest market price CHF 179.80 (June 30, 2017)

Analyst Coverage & Market making


Please note that any opinions, estimates or forecasts regarding u-blox' performance made by these analysts are theirs alone and

do not represent opinions, forecasts or predictions of u-blox or its management.

Analysts

Zürcher Kantonalbank Andreas Müller

Credit Suisse Christoph Gretler

Vontobel Michael Foeth

MainFirst Schweiz Jürgen Wagner

Bank am Bellevue Mischa Roelli

Kepler Chevreux Torsten Sauter

Baader/Helvea Günther Hollfelder

Julius Bär Bruno Winiger

Mirabeau Mark Diethelm

BRYAN, GARNIER & CO Dorian Terral

UBS François Bouvignies

Market making Zürcher Kantonalbank

Upcoming events


• Investor and analyst day October 31, 2017

• 2017 annual results March 15, 2018

• Annual General Meeting April 24, 2018

Investor relations contact


Thomas Seiler

Chief Executive Officer

u-blox Holding AG

Zürcherstrasse 68

8800 Thalwil, Switzerland

Phone: +41 44 722 74 44

Fax: +41 44 722 74 99

E-mail: [email protected]

Roland Jud

Chief Financial Officer

u-blox Holding AG

Zürcherstrasse 68

8800 Thalwil, Switzerland

Phone: +41 44 722 74 44

Fax: +41 44 722 74 99

E-mail: [email protected]

Thank you!

locate, communicate, accelerate

u-blox investor presentation€¦ · source: (ericsson mobility report november 2016, abi wireless...

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